The growing emergency of 1,000 ships trapped in the Arabian Gulf represents a logjam that threatens to surpass in scale the 1980s tanker wars crisis.
To senior industry figures, a “tanker war crisis on steroids” is the most likely outcome, a former navy commander said.
There was also little sign of an imminent solution, said retired Royal Navy officer Tom Sharpe, with 150 ships needed to transit the Strait of Hormuz daily to restore normal supplies, but just a trickle now getting through.
During the tanker wars, in the Iran-Iraq conflict, a lot of traffic kept running. Just twice was all shipping halted for 48-hour periods.
“There was a much higher tolerance to run the gauntlet back then but the threat was less and the Iranians had nothing like the arsenal they have now, which is more like the tanker wars on steroids.”
US Energy Secretary Chris Wright addressed calls for intervention on Thursday, revealing the Navy would not escort ships through the Strait of Hormuz this week but it was "quite likely" that could happen by the end of the month.
The comments were made as another two oil tankers were set ablaze in Iraqi waters on Thursday, with one crew member killed, and Iraq now halting all oil operations at its ports.
Oil prices are also hovering around the $100 a barrel mark despite the International Energy Agency (IEA) agreeing to co-ordinate the release of a record 400 million barrels from various national petroleum reserves around the world, the largest amount in its history.
However, shipping managers have told The National that a coalition of neutral countries is planning to co-ordinate the movement of the vessels out of the Gulf to avoid further being hit by Iran.
Sixteen ships in the region have been attacked since the war began, including four hit by projectiles in Gulf waters and two fuel tankers hit by explosive-laden Iranian boats in Iraqi waters. Iraq has halted all oil operations at its ports in the wake of the attacks. Greenpeace estimated on Thursday that 85 tankers were in the Gulf, carrying at least 21 billion litres of oil or 18.2 m tonnes.
Trapped ships
John Stawpert, a senior manager at the International Chamber of Shipping, said shipping organisations were considering “whether it would be achievable” to extract the trapped vessels.
With the welfare of crews paramount, he urged for “serious consideration” to be given to getting ships moving again through the Strait, or at least allowing those that were stranded to leave.
Mr Sharpe suggested that Iran could be “playing a long game with a steady stream of strikes, one or two a day” achieving the same effect of stopping traffic.
“They don't need to go nuts and put themselves at undue risk, they can retain their missiles and drones, use them sparingly and it’s job done.”
While he approved of the ICS taking steps to resolve the situation, he largely discounted the idea of US warships escorting convoy out. “This would have to have an armada of air cover, be high risk and they’d only get a token number of ships out when its’ historically been 150 ships [transiting Hormuz] a day.
Release the reserves
Oil prices are hovering around the $100 a barrel mark despite the International Energy Agency (IEA) agreeing to co-ordinate the release of a record 400 million barrels from various national petroleum reserves around the world, the largest amount in its history.
While US President Donald Trump promised prices would come down, BP’s former CEO John Brown said he was “very concerned, because the direction of oil prices is always unknown really and volatility has got very high”.
He told the BBC that the problem was that traders “don't know how long this conflict is going to last and how long the Strait of Hormuz is in effect closed”. The waters are a key global artery with one fifth of the world’s oil transiting them.
Despite the IEA announcement, only five or six countries had identified “exactly how much they were going to release,” said Lord Brown.
Risk appetite
To get vessels moving out of the Gulf, Mr Stawpert said, was “dependent on the risk appetite of those ships and on the stance of Iran” because the IRGC navy had been “pretty explicit that they will continue to attack shipping that's crossing the straits”.
The representative of the ICS, which is the principal global trade association for merchant operators, suggested that there could be a duplication of the operation to get ships through the Bab el Mandeb Strait in the Red Sea during the Houthi attacks.
“But we would need to have very, very clear threat profiling in order for the ships to move.”
There were a total of 3,000 ships in the Gulf, including coastal traders, with 1,000 ocean-going vessels that contained more than 20,000 sailors.
He disclosed that the IBF, the International Bargaining Forum that represents mariners, had declared it a high-risk area, meaning that crews were getting double pay and had the right to repatriation.
While welfare on board was not a concern as yet, the ICS was “mindful” that “the longer this goes on, resupply of stores could become an issue” but the main problem was that the sailors were stuck in a war zone.
